Which of the following correctly describe(s)cost recovery of automobiles placed in service in 2016?
A)Total depreciation,including bonus depreciation,cannot exceed $9,600.
B)No cost recovery is allowed if the automobile is used 50% or less for trade or business.
C)The amount of the depreciation deduction cannot exceed $11,160.
D)No cost recovery is allowed for automobiles used for production of income activities.

Question

Quizplus · Accepted Answer

The amount of the depreciation deduction for automobiles placed in service in 2016 cannot exceed $11,160. This amount includes both bonus depreciation and regular depreciation. Option A is incorrect because bonus depreciation is limited to $8,000 for automobiles placed in service in 2016. Option B is incorrect because cost recovery is allowed even if the automobile is used 50% or less for trade or business, but the depreciation deduction is reduced based on the percentage of personal use. Option D is incorrect because cost recovery is allowed for automobiles used for the production of income activities, but the depreciation deduction is reduced based on the percentage of business use.

Which of the Following Correctly Describe(s)cost Recovery of Automobiles Placed